With 2018 in the rearview mirror and 2019 just beginning, enthusiasts are eagerly speculating about what the future holds for the crypto world.
While 2017 was the year of the bull market ( Bitcoin once soared to its peak value of nearly $20,000 In stark contrast, 2018 was a year marked by downtrends, with Bitcoin and its alternative coins plummeting, shedding between 70% to 90% of their value.
Bitcoin As an example, Bitcoin's price dropped to approximately $3,800 at the time of this writing, reflective of a 75% loss, while Ethereum, notable for ether token its smart contract functionalities, plunged from about $1,400 in February to nearly $100 by year's end, signifying a dramatic 90% decline. EOS , bitcoin cash and Ripple’s XRP Numerous digital currencies followed this downward spiral.
What Will Happen in 2019
Will this upcoming year bring change, or should we brace for similar patterns in the coming months? Analysts and industry experts are shifting their focus from cryptocurrency prices to issues of regulation and legitimacy. They agree that to secure institutional interest, frameworks must be enforced and adhered to, otherwise, HODLers may face the dilution of their crypto savings. Tom Lee has stated We're seeing entities like the Securities and Exchange Commission increase their involvement in the sphere of cryptocurrencies. Companies such as
were penalized with severe fines, totaling $250,000 for not registering their initial coin offerings as securities, yet they expressed relief over the situation not being more severe. Paragon Coin and AirFox Roni Cohen Pavon, partner at Herzog, Fox and Neeman law firm
You Have to Register
acknowledges these incidences have set a benchmark in the crypto industry. Though some firms may continue facing compliance challenges, eventually, a commitment to legality and legitimacy will become the norm. Comments include: believes that instances like “With the emergence of security tokens and their use in fundraising, regulators licensing trading platforms to ensure liquidity will create a tangible advantage. I also foresee regulators bolstering trust in crypto custody services and payment solutions, which will enhance user experience for both retailers and consumers.”
A significant hurdle in registering an ICO as a security is the prolonged timeline it demands. The SEC registration process can be laborious, requiring an extensive amount of documentation and patience from firms.
Harder Than It Looks
Furthermore, it's costly. Securing full compliance as a security can demand expenses reaching several thousands of dollars, leading many crypto and blockchain entities to adjust their offerings to avoid security status.
This situation is slowing long-term progress, but the rise of third-party platforms is aiming to streamline the registration procedure, supporting firms throughout the process. As this facilitation becomes more common, it might encourage wider adherence, potentially driving down associated costs.
Blockchain lawyer and crypto consultant Guido Schmitz-Krummacher proposes that we shouldn't view tokens purely as securities but recognize them as 'existing assets.' He asserts:
A New Way of Doing Things
“Products and innovations in the blockchain space will continue to evolve in complexity. A well-planned internal regulatory strategy can save significant costs and ensure the sustainability of a project.”
Nick Marinoff has been immersed in the cryptocurrency landscape since 2014. His roles have varied from lead content writer and news editor at Money & Tech, to public relations roles with Game Credits, and senior writing positions with Bitcoinist and News BTC.
